Un-Laming Phone Games

If mobile phones are the hallmark of our high-tech networked age, why do most of their games date from 1987? Check this June 2006 list of best-selling phone games (.PDF), compiled by Telephia, a performance measurement research firm in the mobile biz: Tetris, Ms. Pac-Man, Galaga, Monopoly, Frogger, Solitaire, Scrabble – hello, what year is this?

“Mobile gaming is the only game platform where backlist is often more powerful than frontlist,” says Eric Goldberg, Managing Director of Crossover Technologies. “Tetris is arguably still the most popular game sold in the world, certainly the most popular in China. Tetris sales alone would make it the third or fourth largest mobile game publisher in the Western world. It makes it harder to introduce new titles.”

Why do classic games rule our phones? “Because you have one tiny little screen to show your game,” Eric says. “It’s worse than Wal-Mart, where you at least have 250 visible shelf facings in the game section. A phone’s entire merchandising area is less than one-sixteenth the size of a PC screen. It’s ‘the tyranny of 18-25 characters'” – the space for the game’s name. Only strong, instantly recognized brands can dance on so small a pinhead. “And even if you’re on the deck [the phone display], the question is, as with newspapers, whether you’re above or below the fold.” Eric can cite studies about how many phone customers see your game based on your location in the phone menu hierarchy. If your game is three screens deep, players locate it four times more often than at four screens deep. The deeper you’re nested, the more you’re hidden.

In years past, as board member for and advisor to publishers, Eric has worked to bring innovative games to the mobile platform, but for now, he’s tabled that ambition. There’s too much headwind.

“The first issue [for publishers] is making sure the carriers will place their game, so their first priority is coming up with a name people will recognize. The problem is that the market forces them to become very conservative. In 2005, I was asked on the E3 and GDC stages, what were the main issues determining success in 2005-06 in the mobile gaming industry. I said ‘carrier relations and post-production.’ They asked, ‘What about creating innovative games?’ I said, ‘You’ll notice I didn’t say anything about that.'”

Even so, Eric believes the mobile field in the medium term “still has magnificent potential. I believe it has a good chance to become the dominant game platform.” Before we get there, though, the whole system has to change. The questions are when and how. Eric has some ideas.

***

In the 20 years I’ve known Eric Goldberg, he has sounded persistently short of sleep.

A lifelong New Yorker, Eric started designing games in 1977, at age 16, at the legendary tabletop wargaming company Simulations Publications, Inc. I met him in 1984, when he was the hard-working R&D Director for the paper-game company West End Games. He co-designed (with his longtime collaborator, Greg Costikyan) the original edition of the satiric roleplaying game PARANOIA, then commissioned me to write one of its early adventures. In 1989, Eric started Crossover Technologies, an early – and impractically premature, it turned out – online game company. Crossover’s biggest success was MadMaze on the Prodigy service, the first online game to gain a million players.

On a trip to London in summer 1999, Eric noticed people sending SMS messages by cell phone, a practice still unusual then in America. “At the time it cost 10P per message, roughly 15 or 16 cents, to do that,” he said in a 2002 interview. “At the end of 1999 there were a billion SMS messages being sent in the British Isles each month at 10P a crack.” After studying cell phone installed-base projections that predicted hockey-stick growth, Eric raised a million in venture capital and, with Greg Costikyan and Jonathan Zamick, started a “Silicon Alley” tech company, Unplugged Games. His timing was better here; Unplugged launched games with Verizon in December 2000 and Sprint in January 2001. However, Unplugged ran aground for two reasons: too little money and extremely bad luck. Unplugged secured new financing, but scheduled it for September 18th, 2001 – “which, as a date to be in New York City and trying to get things done was, shall we say, poor timing.”

Selling Unplugged to Zamick, Eric became an advisor and strategist for mobile gaming firms such as Digital Chocolate, Kayak Interactive, (M)forma (now Hands-On Mobile), In-Fusio, Reaxion, Vindigo and Warner Music Group. He travels a lot: In mid-November, he visited Beijing, where he gave the keynote speech at the first China Mobile Game International Summit. When I finally connected with him, he had just returned to his Park Avenue apartment and was unspeakably jet-lagged. For Eric, that’s basically normal.

What is he advising about nowadays? “They [mobile gaming publishers] generally want to know what the carriers are going for, what are the trends. … One or two are concerned about M&A [mergers and acquisitions]. (I advised Centerscore on its sale to Vivendi Games earlier this year.) They all care about the carriers – which things sell well, strategies for deck placement, carrier network connectivity.

“It’s a carrier world; the rest of us just live in it. We love the carriers’ customer acquisition – we just wish they would share it more often.” But carriers have little interest in catering to publishers’ whims; “carriers measure their game revenue in tenths of a percent of their total income.”

Even so, “mobile gaming worldwide was a $2 billion industry in 2005 – in the U.S., half a billion; in Europe maybe half a billion, probably slightly under; Asian markets over a billion, with Korea and Japan leading. It is arguably the second largest delivery medium for games, after consoles. Many well-funded new entrants are swarming into the market: Vivendi, EA, RealNetworks. Growth has slowed in the leading markets, but that’s mostly a consequence of the law of large numbers: it’s easier to have large percentage increases in a $50 million market than in a half-billion market.”

***

Even when not piling up frequent-flyer miles to China, Eric thinks in global terms.

• “Korea and, to an extent, Japan are playing in a different league from everyone else. They’re much more advanced in technology, business models, value chain, you name it. In Japan, the dominant players are Bandai, Square Enix, Namco – the native players, who have best-selling games from other media like Pac-Man and Final Fantasy. Korea tends to do games that are highly consumable, with the market life of a mayfly, perhaps as little as four to six weeks. This is a barrier to entry for Western publishers; the games you introduce will cycle through the market far too soon for you to be ready with the next releases. In Japan and Korea, Western companies are trying to come in. But just as the experience of Japanese and Korean companies in America has been dismal – a handful of Japanese companies have achieved success in the U.S. market, usually after three years of failure – there has been no comparable U.S. success in the Japanese market, with a couple of notable exceptions like Tetris.

• “The BRIC countries are coming – Brazil, Russia, India, China. China is a huge potential market; though its mobile game numbers last year (2005) were not greater than US$30 million, there are 400 million mobile phone users. Almost everyone has tried to go into China, because it’s ‘going to be really, really big,’ and discovered that the market has yet to produce really big revenue numbers. Also, the Chinese government has restricted foreign ownership. A further major issue with China is that less than half the handsets are game-capable. The per-capita income is below $10K annually, perhaps in the $6-7K range, as in India.

• “The Indian market is impressive, but they still have the remnants of the ‘license Raj‘; they’re stuck in more red tape than even the Chinese market. India does have a more diverse and freewheeling mobile carrier environment – five or seven effective carriers, as opposed to China, which is basically an effective duopoly of China Mobile and China Unicom.”

Great – but what about the games? Any prospects cooler than 1980s arcade games? Basically no, Eric says. Not yet.

Why is it so challenging?

***

The cost of entry into mobile gaming, once dirt cheap, has grown formidable, not so much in production but afterward.

“Post-production, which includes porting, as of a year ago, was a higher cost than game development. In 2004, to launch an A title worldwide, you needed to do 500 [ports] – different versions for Sprint, Verizon and Cingular, then a different version for each handset. In Europe, you have to do it for T-Mobile or Vodafone, then one English version, one German, one Dutch.” (Gaming god John Carmack, who recently created the mobile titles DoomRPG and Orcs & Elves, has blogged about the irritations of cell phone game programming.)

Eric sees some signs of improvement. “Nokia, with its Series 40s and 60s, has made sure there’s relatively little need for porting needed between phones within these series. And there are companies making porting tools that make it easier, like Tira Wireless and Mobile Complete.

“But the situation is ‘less worse’ rather than ‘better.’ And it cannot be fully automated, no matter what anyone tells you.”

What about funding all these ports with the PC world’s cash cow, online games? “Nobody has particularly figured out how to make multiplayer work as a business model. Many European carriers don’t support subscription revenues. Without subscriptions (or a similar continuing-revenue model such as advertising), there’s no obvious way to make multiplayer games work in the marketplace.”

Great. So why does Eric still think mobile can surpass consoles to become the dominant gaming platform? How can he be so excited about mobile?

“From a business viewpoint, it’s easy: It’s a $2 billion market. There are over 200 million wireless phone subs in the U.S. The mobile phone is ubiquitous, portable, networked and is voice-capable. It’s a field that works – though right now it’s going through consolidation, the pain that happens when the companies discover that everyone is crowding into their space.

“Against that, it’s not a game platform. On the network side, it’s networked to optimize one-on-one activity, mirroring the voice phone call – but that doesn’t mean it can’t support new technology.

“There are some carriers who are doing some good work – game-friendly stuff. But at the end of the day, the games tail will not wag the carrier dog. As long as the carriers are essential, rather than dumb pipes, they block the way to a more application-friendly environment. Their business preferences create an environment where things don’t talk nice to each other, so they maintain more control. Their nightmare is that they become just dumb pipes, like ISPs have become for the internet.

“The main bottlenecks resulting from the carrier infrastructure and business culture will eventually be removed by WiMax or one of the other standards. In all likelihood, by 2011-12 you’ll see the functional equivalent [on mobile platforms] of the current internet.”

Speed the day. Tetris is a great game, but another five or six years of falling blocks is enough.

Allen Varney designed the PARANOIA paper-and-dice roleplaying game (2004 edition) and has contributed to computer games from Sony Online, Origin, Interplay and Looking Glass.